I had learned about this thing called startup incubation a while back. After all, I was an intern at an organization that went through this process as well. I was sitting at a desk and typing on my laptop, doing the assignments when my senior was given a lecture about the criteria for startup incubation. In all honesty, this was not what I was interning for.
I was interning there for content writing. But regardless, as he was listening to what our senior said I got curious as well. Our senior had just finished telling him about the criteria that we need to meet for Startup Incubation. But he had just gone out for a coffee break when I chipped in – What about the process of startup incubation ma’am?
Now it has to be noted that she just finished a 30-minute lecture about a topic related to this one and she was admittedly tired. She called in another senior of ours and told him to explain the process to me and so he did.
Just like my senior, I am pretty dumb when it comes to business and maybe even dumber than him. But after the lecture, I was told to explain this whole thing to my senior as well (since he went out for a coffee break) so I had to listen carefully. I still don’t get most of the parts and the technicality of this whole process. So, I won’t go into the details. However, I can tell you guys what my senior told me. In that way, you can at least get the basic idea for the process of startup incubation.
Find the incubator and submit the proposal (Pre-incubation)
The first thing that you have to do to start the process of startup incubation is of course find an incubator. When you meet the startup incubator you will have to present them the Business Process Design (BPD- more on this later) which is basically the whole working plan of your business.
Then incubators will see and judge your business plan. It all depends on them to accept you or not. If they don’t accept you, then sad news for you, your idea is not as innovative as you thought. You better go back to square one and review your idea to make it better. However, if they do accept you as eligible for incubation then that is whole another thing.
This is when your pre-incubation begins. In this phase of the Startup Incubation Process, they will analyze your plan. What I mean by this is that they will revisit your initial plan and make adjustments to it to make it better- of course after consulting you. Along with this, they will provide you with full guidance on how to make the plan practical and feasible. Along with this, they will guide you on how to generate the most profit you can with your idea. After all, once you are under startup incubation, your profit is their profit.
Take advice, uses the services, and grow (Incubation)
This is basically where your incubation actually begins. They will give you whatever services you need- be it technical, advisory, or financial services. Yes, you will get financial services. But they will monitor every cent you spend so you have to be careful where you spend their money. But your startup will get all the things you need at the end of the day.
For the services they provide, you will have to come up with a product that is viable in the market or a Market Viable Product (MVP). You will then test this product in the market itself to see the public response and work on it till you get a product that is good enough to generate profit for both you and your investors.
Now you have to note the time here as this process usually lasts only for around a year. Our senior added as he was telling us this “for others a year may seem long but when someone has invested heavily on you and your company, to come up with a product that will sell well, a year is as short as one breath”. It seemed like he remembered his time when he first started up his company as I could see signs of nostalgia on his face.
Speed up your growth (Accelerator)
He continued “A year passes by and you come up with a product. Now it is time to grow and you have to grow fast.” I asked in curiosity “what if you can’t come up with that product?” he smiled and then replied “well then it is game over for you. You have successfully wasted both your time and money. Not only yours but theirs as well. They can easily sue you for this and consider this a fraud. But let’s not talk about this. Let’s focus on the positive aspect and talk about the phase when you will get a chance to grow fast” he answered my question and continued.
As the name suggests, this is the period of growth for your company. You should know where and how to sell your product by this point. So your main focus should be to make a profit and increase it quickly. The startup incubators will still be supporting you and they will continue to do so until you become a fully-fledged industry.
They will provide you with any advice you need. However, you will have to sustain the production and manage the promotion by yourself. They will still be a part of your finance though as this is the phase where you will start to pay back their investment and earn some profit for your company.
Now you are free
He finished this part, stroked his beard, and said “After a few months of this you should have become a fully-fledged industry on your own and start to pay them back and end the incubation.”
“But won’t it mean that we will end their support?” I asked him.
“Well yes, but then again you won’t need their support anymore. However, they will still be your business partners – that is as long as you don’t dissolve the contract made before you began the incubation period” he answered. I was satisfied for a while but then I remembered another person- the one who went out for the coffee break. I started to get a headache while thinking of how to explain all of these to him as I remembered he was just as dumb in this area just as much as me if not more.